9 September 1987 is remembered as an extraordinary day in the history of global real estate. On that day, an experiment was carried out in Shenzhen, China, that would play an important role in transforming not only the Chinese property market in the years to come, but also the entire system of urban development and land management.

What made the experiment particularly interesting was that the government did not sell ownership of the land to any private individual or company. Instead, ownership remained with the state while the right to use the land was transferred to an investor. According to research studies, on 9 September 1987, the right to use a plot of land measuring approximately 5,321.8 square meters in Shenzhen was transferred through negotiations to a local company at a rate of 200 yuan per square meter.

At first glance, this decision appeared to be a limited administrative experiment. In reality, however, it raised a fundamental question about China’s land and real estate system: If land is owned by the state, can the right to use it be transferred through the market?

At that time, state control over land in China was extremely strong. The idea of buying and selling land as an ordinary commercial commodity was entirely different from the modern real estate market. Shenzhen, which was then emerging as a major special economic zone for experimenting with reform and opening up, was searching for new financial resources to support rapid development.

As a result, the concept of separating land ownership from the right to use it emerged. This became the key point that later played an important role in laying the foundation for China’s modern land system.

But the story did not end there.

Just a few months after the 9 September experiment, on 1 December 1987, Shenzhen held the first formal public land auction in Chinese history. The Shenzhen government openly auctioned the right to use the land and granted it to an investor through competitive bidding. According to Shenzhen’s official history, this auction proved to be a decisive moment in reforming China’s land management system.

This first experiment gradually helped create a system in which actual ownership of the land could remain with the state, while the rights to use it could be transferred through the market for fixed periods. In the years that followed, this concept became a fundamental part of China’s urban real estate system. According to research sources, different terms were later established for urban land-use rights, including 70 years for residential use, 50 years for industrial use, and 40 years for commercial use.

This change was not merely legal or administrative in nature. It also affected the construction of Chinese cities, government revenue, infrastructure development, and the real estate market. The transfer of land-use rights made urban land part of economic activity and gave governments the opportunity to use land as a financial resource for urban development.

To give this experiment legal status, changes were later made to China’s Constitution as well. On 12 April 1988, Article 10 of the Constitution was amended to allow for the transfer of land-use rights. After that, the Shenzhen experiment gradually became part of a broader national system.

Today, when the world looks at China’s towering cities, large housing projects, commercial districts, and multibillion-dollar property market, very few people may remember this small historical experiment.

But 9 September 1987 is extraordinary in the history of real estate because, on that day, a question was put into practice that would later transform the land system of an entire country:

Can land remain state-owned while the right to use it is bought and sold in the market—is this possible?

Shenzhen provided a practical answer to that question, and this experiment later became one of the important foundations of China’s modern real estate system.